“100,000 low-cost homes have had rents hiked since 2012”

“Labour has unveiled plans to stem the loss of low-cost homes as new analysis reveals more than 100,000 social homes have been converted into a more expensive type of property in the last six years alone.

The party said it would scrap a policy introduced by the Conservative-Lib Dem coalition government in 2012 that forces housing associations and local councils to raise rents by an average of 40 per cent by converting social homes into “affordable homes”.

The announcement is the second to come out of Labour’s review into the future of social housing, which is likely to report in the coming weeks.

It comes as analysis seen by The Independent revealed the huge loss of social homes largely as a result of a change made by the coalition. …

While social rents are generally around 40 per cent of market value, affordable homes can cost up to 80 per cent of market rents, prompting criticism that in many parts of country they are out of the reach of people on ordinary incomes. …

The coalition made the conversion of low-cost social homes into affordable homes a key plank of its housing policy.

An official document from 2011 explaining the Government’s approach said: “The conversion of existing stock to affordable rent is a crucial element in generating additional financial capacity and it is anticipated that it will be integral to the offer that providers bring forward as part of their proposals for funding new supply.”

The change was made despite the Government’s own impact assessment making it clear that forcing the conversion of social housing into affordable housing would result in “greater costs to Government through increases in housing benefit”, although this was forecast to be offset by cuts to housing spending. …

At the same time as the change was made, Government funding for new social housing was ended entirely and instead diverted to fund “affordable” homes.

As a result, the number of new, Government-funded social homes has plummeted by 97 per year since 2010, with just 1,102 new homes completed last year – funded via existing programmes set up before 2010. …

About 102,000 homes have been converted since 2012, while around 60,000 have been sold to tenants under Right to Buy.

Only around 50,000 new social homes have been built in that time – the vast majority funded by housing associations. …”